EMPLOYEE BENEFIT PLANS

12 Months Ended

Dec. 31, 2025

EMPLOYEE BENEFIT PLANS

EMPLOYEE BENEFIT PLANS

15. EMPLOYEE BENEFIT PLANS

PENSION PLAN

The Company has a noncontributory defined benefit pension plan covering certain employees who work at least 1,000 hours per year. The participants shall have a vested interest in their accrued benefit after five full years of service. The benefits of the plan are based upon the employees’ years of service and average annual earnings for the highest five consecutive calendar years during the final ten-year period of employment. Effective January 1, 2013, the Company implemented a soft freeze of its defined benefit pension plan for non-union employees. A soft freeze means that all existing employees as of December 31, 2012 will remain in the defined benefit pension plan, but any new non-union employees hired after January 1, 2013 will no longer be part of the defined benefit plan but instead will be offered retirement benefits under an enhanced 401(k) program. The Company implemented a similar soft freeze of its defined benefit pension plan for union employees effective January 1, 2014. The Company executed these changes to help reduce its pension costs in future years. Plan assets are primarily debt securities (including U.S. Treasury and Agency securities, corporate notes and bonds), listed common stocks (including shares of the Company’s common stock valued at $2.4 million and $1.8 million as of December 31, 2025 and 2024, respectively, and is limited to 4% of the plan’s assets), mutual funds, and short-term cash equivalent instruments. The following actuarial tables are based upon data provided by an independent third party as of December 31.

Pension Benefits

	YEAR ENDED DECEMBER 31,
	2025		2024
	(IN THOUSANDS)
CHANGE IN BENEFIT OBLIGATION:
Benefit obligation at beginning of year	$	31,228	$	34,819
Service cost		715		832
Interest cost		1,527		1,562
Actuarial loss (gain)		307		(532)
Settlements		—		(4,521)
Benefits paid		(2,758)		(932)
Benefit obligation at end of year		31,019		31,228
CHANGE IN PLAN ASSETS:
Fair value of plan assets at beginning of year		62,617		59,335
Actual return on plan assets		7,699		8,735
Employer contributions		—		—
Settlements		—		(4,521)
Benefits paid		(2,758)		(932)
Fair value of plan assets at end of year		67,558		62,617
Funded status of the plan	$	36,539	$	31,389

	YEAR ENDED DECEMBER 31,
	2025		2024
	(IN THOUSANDS)
AMOUNTS NOT YET RECOGNIZED AS A COMPONENT OF NET PERIODIC PENSION COST:
Amounts recognized in accumulated other comprehensive loss consists of:
Net actuarial (gain) loss	$	(1,197)	$	2,045
Total	$	(1,197)	$	2,045

	YEAR ENDED DECEMBER 31,
	2025		2024
	(IN THOUSANDS)
ACCUMULATED BENEFIT OBLIGATION:
Accumulated benefit obligation	$	29,194	$	29,215

The weighted-average assumptions used to determine benefit obligations at December 31, 2025 and 2024 were as follows:

	YEAR ENDED DECEMBER 31,
	2025		2024
WEIGHTED AVERAGE ASSUMPTIONS:
Discount rate	5.30	%	5.58	%
Salary scale
Ages 25-34	5.00		5.00
Ages 35-44	4.00		4.00
Ages 45-54	3.00		3.00
Ages 55+	2.50		2.50

	YEAR ENDED DECEMBER 31,
	2025		2024
	(IN THOUSANDS)
COMPONENTS OF NET PERIODIC PENSION BENEFIT:
Service cost	$	715	$	832
Interest cost		1,527		1,562
Expected return on plan assets		(4,150)		(4,157)
Settlement charge		—		471
Net periodic pension benefit	$	(1,908)	$	(1,292)

The service cost component of net periodic pension benefit is included in salaries and employee benefits and all other components of net periodic pension benefit are included in other expense on the Consolidated Statements of Operations.

The Company did not recognize a settlement charge in connection with its defined benefit pension plan in 2025 while a settlement charge of $471,000 was recognized in 2024. A settlement charge must be recognized when the total dollar amount of lump sum distributions paid from the pension plan to retired employees exceeds a threshold of expected annual service and interest costs in the current year. It is important to note that since the retired employees elected to take lump sum payments, these individuals are no longer included in the pension plan which favorably impacts the Company’s basic pension expense. Therefore, the Company’s basic annual pension expense is expected to be lower in the future. This was evident in 2024 and 2025 as the Company recognized a net periodic pension benefit in both years.

Note that pension settlement charges are dependent upon the level of national interest rates from the previous year and the impact that interest rates have on lump sum distributions to those employees eligible to retire. Pension settlement charges are also dependent upon the choice of retiring employees to either take a lump sum distribution or receive future monthly annuity payments.

The accrued pension obligation, which had a positive (debit) balance of $36.1 million and $31.4 million, was reclassified to other assets on the Consolidated Balance Sheets as of December 31, 2025 and 2024, respectively. The balance of the accrued pension obligation continues to be a positive value as a result of the strong returns on plan assets and the revaluation of the obligation.

	YEAR ENDED DECEMBER 31,
	2025		2024
	(IN THOUSANDS)
OTHER CHANGES IN PLAN ASSETS AND BENEFIT OBLIGATIONS RECOGNIZED IN OTHER COMPREHENSIVE INCOME
Net gain	$	(3,242)	$	(5,110)
Recognized loss		—		(471)
Total recognized in other comprehensive income before tax effect	$	(3,242)	$	(5,581)
Total recognized in net periodic pension benefit and other comprehensive income before tax effect	$	(5,150)	$	(6,873)

For the year ended December 31, 2025, actuarial gains/losses in the projected benefit obligation were the result of the plan experience, updated census data, discount rate, lump sum interest rates, and lump sum mortality tables. These sources generated a combined loss of about 0.99% of expected year-end obligations.

The weighted-average assumptions used to determine net periodic pension benefit for the years ended December 31, 2025 and 2024 were as follows:

	YEAR ENDED DECEMBER 31,
	2025		2024
WEIGHTED AVERAGE ASSUMPTIONS:
Discount rate	5.59	%	5.12	%
Expected return on plan assets	7.00		7.00
Rate of compensation increase
Ages 25-34	5.00		5.00
Ages 35-44	4.00		4.00
Ages 45-54	3.00		3.00
Ages 55+	2.50		2.50

The Company has assumed a 7.00% long-term expected return on plan assets. This assumption was based upon the plan’s historical investment performance over a longer-term period of 20 years combined with the plan’s investment objective of balanced growth and income. Additionally, this assumption also incorporates a targeted range for equity securities of approximately 0% to 60% of plan assets.

Plan Assets

The plan’s measurement date was December 31, 2025. The plan’s asset allocation at December 31, 2025 and 2024, by asset category, was as follows:

	YEAR ENDED DECEMBER 31,
	2025		2024
ASSET CATEGORY:
Cash and cash equivalents	3.5	%	1.4	%
Fixed income	43.9		35.1
Equity	52.6		63.5
Total	100.0	%	100.0	%

The major categories of assets in the Company’s pension plan as of year-end are presented in the following table. Assets are segregated by the level of the valuation inputs within the fair value hierarchy established by ASC Topic 820 utilized to measure fair value.

	YEAR ENDED DECEMBER 31,
	2025		2024
	(IN THOUSANDS)
Level 1:
Cash and cash equivalents	$	2,384	$	878
Fixed income		29,627		22,003
Equity		35,547		39,736
Total fair value of plan assets	$	67,558	$	62,617

Cash and cash equivalents may include uninvested cash balances along with money market mutual funds, treasury bills, or other assets normally categorized as cash equivalents. Fixed income may include mutual funds that are categorized as balanced, domestic, international, or global/emerging, as well as exchange traded funds. In addition, fixed income may include individual bonds that are government, corporate, or international. Equity may include common or preferred stocks, covered options, rights or warrants, or American Depository Receipts which are traded on any U.S. equity market. In addition, equity may include mutual funds and exchange traded funds.

The investment strategy objective for the pension plan is a balance of growth and income. This objective seeks to develop a portfolio for acceptable levels of current income together with the opportunity for capital appreciation. The balanced growth and income objective reflects an equal balance between fixed income and equity investments. The allocation between fixed income and equity assets may vary to a moderate degree during normal market cycles. The pension plan’s allocation to fixed income can fall within the range of 0% to 100% of the plan assets while the allocation to equity is 0% to 60%. In addition, cash equivalents can range from 0% to 100% of the plan assets. The plan is also able to invest in ASRV common stock up to a maximum level of 4% of the market value of the plan assets (as of December 31, 2025 and 2024, 3.6% and 2.8%, respectively, of the plan assets were invested in ASRV common stock). This asset mix is intended to ensure that there is a steady stream of income generated to fund benefit payments.

Cash Flows

The Company presently expects to contribute $0 to the plan in 2026. Funding requirements for subsequent years are uncertain and will significantly depend on whether the plan’s actuary changes any assumptions used to calculate plan funding levels, the actual return on plan assets, changes in the employee groups covered by the plan, and any legislative or regulatory changes affecting plan funding requirements. For tax planning, financial planning, cash flow management or cost reduction purposes the Company may increase, accelerate, decrease or delay contributions to the plan to the extent permitted by law.

Estimated Future Benefit Payments

The following benefit payments, which reflect future service, as appropriate, are expected to be paid.

	ESTIMATED FUTURE
YEAR:	BENEFIT PAYMENTS
	(IN THOUSANDS)
2026	$	4,663
2027		4,022
2028		3,356
2029		2,943
2030		2,693
Years 2031-2035		12,178

401(k) PLAN

The Company maintains a qualified 401(k) plan that allows for participation by Company employees. Under the plan, employees may elect to make voluntary contributions to their accounts, which the Company will match one half on the first 2% of contributions up to a maximum of 1%. The Company also contributes 4% of salaries for union members who are in the plan. These contribution percentages apply to employees who are eligible to participate in our defined benefit pension plan.

Effective January 1, 2013, any new non-union employees receive a 4% non-elective contribution, and these employees may elect to make voluntary contributions to their accounts which the Company will match one half on the first 6% of contributions up to a maximum of 3%. Effective January 1, 2014, any new union employees receive a 4% non-elective contribution, and these employees may elect to make voluntary contributions to their accounts which the Company will match dollar for dollar up to a maximum of 4%. Contributions by the Company charged to operations were $1.0 million and $982,000 for the years ended December 31, 2025 and 2024, respectively. The fair value of plan assets includes $534,000 and $390,000 pertaining to the value of the Company’s common stock that was held by the plan at December 31, 2025 and 2024, respectively.

DEFERRED COMPENSATION PLAN

The Company maintains a non-qualified deferred compensation plan in which a select group of executives are permitted to participate. An eligible executive can defer a certain percentage of their current salary to be placed into the plan. The Company has established a rabbi trust to provide funding for the benefits payable under our deferred compensation plan. As of December 31, 2025 and 2024, the Company reported a deferred compensation liability of $183,000 and $350,000, respectively, within other liabilities on the Consolidated Balance Sheets. For the years ended December 31, 2025 and 2024, the Company recognized deferred compensation plan expense of $9,000 and $19,000, respectively. The deferred compensation plan expense is reported within other expense on the Consolidated Statements of Operations. See Note 5 (Investment Securities) for additional disclosures related to the nonqualified deferred compensation plan and assets held within the rabbi trust.

Except for the above-described benefit plans, the Company has no significant additional exposure for any other post-retirement or post-employment benefits.